how did the panic of 1873 hasten the end of reconstruction?

They were met with brutality as police dispersed the crowd, and consequently the unemployment movement lost much of its steam. Matt Morgen, Print of a crowd driven from Tompkins Square by the mounted police, in the Tompkins Square Riot of 1874, January 1874.
[17][18], In July 1877, the market for lumber crashed, leading several Michigan lumber companies to go bankrupt.

That same year, the depression set off railroad strikes. A large infusion of cash from speculators caused spectacular growth in the industry and in the construction of docks, factories, and ancillary facilities. var googletag = googletag || {}; Jay Cooke's firm, like many others, had invested heavily in the railroads. So when the banking firm of Jay Cooke and Company, a firm heavily invested in railroad construction, closed its doors on September 18, 1873, a major economic panic swept the nation. Rival governments arose claiming to recognize Tilden as the rightfully elected President. The French also attempted to deal with their economic problems by the implementation of tariffs. {if(f.fbq)return;n=f.fbq=function(){n.callMethod? A similar process of overexpansion took place in Germany and Austria-Hungary, where the period from German unification in 1870 and 1871 to the crash in 1873 came to be called the Gründerjahre ("Founders' Years"). In Cape Colony, the panic caused bankruptcies, rising unemployment, a pause in public works, and a major trade slump that lasted until the discovery of gold in 1886. But between 1869 and 1871, their home rule platform, asserting that good government was run by locals—meaning white Democrats, rather than black or white Republicans—helped end Reconstruction in three important states: Tennessee, Virginia, and Georgia. Poor economic conditions also caused voters to turn against the Republican Party; in the 1874 congressional elections, the Democratic Party assumed control of the House for the first time since the Civil War.

[27][28], Although the collapse of the foreign loan financing had been predicted, the events of that year were in themselves comparatively unimportant. In the end, the fighting between strikers and troops left more than 100 people dead and many more injured.

Factories began to lay off workers as the country slipped into depression. [41], In the periphery, the Ottoman Empire's economy also suffered. The New Press, 2010. p 149. The Panic of 1873 and the subsequent depression had several underlying causes for which economic historians debate the relative importance. The panic and depression hit all of the industrial nations. After the 1873 depression, agricultural and industrial groups lobbied for protective tariffs. "1877: America's Year for Living Violently. [38] However there was heavy unemployment in the basic industries of coal, iron and steel, engineering, and shipbuilding, especially in 1873, 1886 and 1893. /* fbq('track', 'PageView'); */ A period of economic overexpansion arose from the northern railroad boom before a series of economic setbacks: the Black Friday panic of 1869, the Chicago fire of 1871, an outbreak of equine influenza and the Boston fire of 1872, and the demonetization of silver in 1873. Wikimedia. Businesses were expanding, but the money they needed to finance that growth was becoming scarcer. Bellesiles, Michael A. The decision of the German Empire to cease minting silver thaler coins in 1871 caused a drop in demand and downward pressure on the value of silver, which, in turn, affected the US since much of the supply of silver was mined there. This collapse was disastrous for the nation's economy. [24][25][26] In 1865, Keglevich and Strousberg had come into direct competition in a project in what is now Slovakia. By the time the depression lifted in 1879, southern whites would already be regaining power.

The effects of the panic were quickly felt in New York and more slowly in Chicago; Virginia City, Nevada, where silver mining was active; and San Francisco. That restored peace to Martinsburg but proved controversial, with many newspapers critical of Matthews's characterization of the strikes as an "insurrection", rather than an act of desperation. Court, Cambridge University Press 1965. [15] Building construction was halted, wages were cut, real estate values fell, and corporate profits vanished.[16]. Johnson proved to be a strong supporter of black civil rights throughout his presidency. Republicans chose Rutherford B. Hayes as their nominee while Democrats chose Samuel J. Tilden, who ran on honest politics and home rule in the South. In September 1873, Jay Cooke and Company declared bankruptcy, resulting in a bank run that spiraled into a six-year depression. [31][32] Moreover, German businesses managed to avoid the sort of deep wage cuts that embittered American labor relations.

Paul Kleppner, "The Greenback and Prohibition Parties," in Arthur M. Schlesinger (ed.). The resulting outcry raised serious questions about how long the new policy would last. They focused on business, economics, political corruption, and trade, instead of Reconstruction. The stage was set for an election that would end Reconstruction as a national issue. [35] The Suez Canal was opened in 1869. The Panic of 1873 and Its Aftermath: 1873-1876. by Drew E. VandeCreek The Panic of 1873 began on September 18 with the failure of the Philadelphia investment house of Jay Cooke. As a result, the US Congress passed the Coinage Act of 1873, which changed the national silver policy.

// cutting the mustard In September 1873, the US economy entered a crisis. Bismarck gradually veered away from classical liberal economic policies in the 1870s, embracing many economic interventionist policies, including high tariffs, nationalization of railroads, and compulsory social insurance. Lasting from September 1873 until 1878/9, the economic downturn then became known as the Long Depression after the stock market crash of 1929. The Act moved the United States to a de facto gold standard, which meant it would no longer buy silver at a statutory price or convert silver from the public into silver coins, but it would still mint silver dollars for export in the form of trade dollars.[6]. Still, many corporations were able to reduce production costs and achieve better productivity rates, with industrial production increasing by 40% in Britain and by over 100% in Germany. fbq('track', 'ViewContent'); The sudden collapse of the nation's economy left 3 million people without jobs, which led northerners to lose interest in Reconstruction as they focused on reversing the economic depression. Library of Congress, Sign up for the American Experience newsletter!

The Compromise allowed southern Democrats to return to power, no longer fearing reprisal from federal troops or northern politicians for their flagrant violence and intimidation of black voters. The economic development of the American nation, p. 356, Reginald Charles McGrane, Ginn & Co., Boston 1950. googletag.cmd = googletag.cmd || []; Since the end of the Civil War, railroad construction in the United States had been booming.

New French laws in 1880 and in 1892 imposed stiff tariffs on many agricultural and industrial imports. Public opinion made it difficult for the Grant administration to develop a coherent policy on the Southern states, and the North began to steer away from Reconstruction. [7] The Act also reduced the domestic money supply, raising interest rates and hurting farmers and others who normally carried heavy debt loads. Overview. Yet, with its most revolutionary aims thwarted by 1868, and economic depression and political turmoil taking even its most modest promises off the table by the early 1870s, most of the promises of Reconstruction were unmet.

A series of Viennese bank failures ensued, causing a contraction of the money available for business lending. The Panic of 1873 was a financial crisis that triggered an economic depression in Europe and North America that lasted from 1873 to 1877 or 1879 in France and in Britain. By 1875, when armed conflict broke out in Mississippi and the state’s Republican governor urged federal involvement, national Republicans felt they had no choice but to ignore the plea.
Between 1868 and 1877, and accelerating after the Depression of 1873, national interest in Reconstruction dwindled as economic issues moved to the foreground. Building tracks where land had not yet been cleared or settled required land grants and loans that only the government could provide.

In 1877, steep wage cuts led American railroad workers to launch the Great Railroad Strike.



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